Abstract
Household happiness plays a fundamental role in shaping daily lives. In the technology era, digital financial inclusion (DFI) significantly influences household happiness. Despite the growing interest in DFI, existing studies have yet to analyze its specific impact on household happiness. In response, this study aims to fill this gap through an in-depth examination of the relationship between DFI and household happiness, with financial behaviors as a mediator. Additionally, this study adopts financial literacy (FL) as a moderator in the DFI-financial behavior relationship. By employing the Peking University DFI Index of China (DFIIC) and data from the China Household Finance Survey (CHFS), this study finds that DFI significantly positively influences household happiness. Borrowing and saving behaviors exhibit a significant negative impact on household happiness. Spending behavior had no intermediary role in household happiness. Furthermore, investing behavior plays a partial intermediary role in enhancing household happiness. Regarding the moderating effect of FL, the results suggest that higher FL increases household happiness but reduces the marginal positive effect of DFI. This indicates a complex interplay between DFI and financial literacy. This study contributes by testing the mediating role of financial behaviors in the relationship between DFI and household happiness. Additionally, the findings on the moderating effect of financial literacy offer novel insights for policymakers to design inclusive policies that enhance people's well-being. Lastly, future research may focus on how financial behaviors influence the DFI-household happiness relationship.